(GUA) Son of media tycoon Rupert Murdoch is the lead candidate to replace the embattled Tesla founder

James Murdoch, son of media tycoon Rupert Murdoch, is the leading candidate to take over chairmanship of Tesla. Photograph: Bryan Bedder/Getty Images for National Geographic

James Murdoch is the favourite to take over the chairmanship of volatile electric-carmaker Tesla from its embattled founder, Elon Musk, according to reports.

The son of newspaper, satellite TV and movie studio tycoon Rupert Murdochis now the lead candidate for the Tesla chair, the Financial Times reported on Wednesday, citing two people briefed on the discussions.

Musk agreed he would step down as chairman by mid-November but remain as chief executive officer, after he and Tesla reached a settlement with US financial watchdog the Securities and Exchange Commission (SEC) last month in which they agreed to pay $20m each to financial regulators. The billionaire had claimed in early August to have secured funding to take Tesla private, sending markets scrambling.

There then followed much concern about his health and stability after he talked about sleeping little because of the high stress of the job, and he smoked a joint during a podcast interview amid swirling speculation about drug use.

James Murdoch is currently chief executive of 21st Century Fox, but will leave the role when the entertainment giant completes the sale of the majority of its assets to Disney, and will be succeeded by his brother Lachlan. He joined Tesla’s board last year as a non-executive director and has reportedly said he wants the job of chair.

The Tesla board is understood to have not yet made a final decision about Musk’s successor and may still appoint an external candidate.

On Tuesday, Murdoch resigned from the board of Sky plc, the owner of Sky News, as part of Comcast’s takeover of the company, beating 21st Century Fox in an intense bidding war. He is also contemplating starting a technology investment fund.

“The Tesla chairman job is perfect for James,” a person briefed on the discussions told the FT. “He’s working on this fund and will be sitting next to Elon … he’s going to get access to so much deal flow.”

Silicon Valley-based Musk created the electric carmaker and aerospace company SpaceX, which has been launching space rockets in a bid to win commercial space transportation business in future – and realising Musk’s talk of colonising Mars.

Tesla is wildly successful by many measures, but has been under pressure over profits, keeping up with demand and conditions for workers.

Its shares have struggled amid the recent controversy, trading around $259.52 at the time of writing, around a 27% fall since Musk tweeted his intention to take the firm private at $420 a share.

The SEC filed a suit accusing Musk of fraud in relation to the tweets, alleging his go-private plan, which he abandoned weeks later, had no basis in fact. The tech billionaire accepted a $20m fine and agreed to step down as chairman as part of the settlement.

Tesla and 21st Century Fox did not immediately respond to a request for comment.

Shares of Tesla on Wednesday afternoon pared losses to trade down 1.6% at $258.50.